Thursday, October 2, 2008

Meet Suzanne and Jenny, part of "Illuminations." They'll be back at Les Beans this coming Saturday night starting around 8 p.m. They are quite good and do original songs, along with covers. There is live music there every Friday and Saturday nights - good coffee, light menu. Check it out!

I want to talk for a few minutes with the people of the United States about banking -- with the comparatively few who understand the mechanics of banking but more particularly with the overwhelming majority who use banks for the making of deposits and the drawing of checks. I want to tell you what has been done in the last few days, why it was done, and what the next steps are going to be. I recognize that the many proclamations from State Capitols and from Washington, the legislation, the Treasury regulations, etc., couched for the most part in banking and legal terms should be explained for the benefit of the average citizen. I owe this in particular because of the fortitude and good temper with which everybody has accepted the inconvenience and hardships of the banking holiday. I know that when you understand what we in Washington have been about I shall continue to have your cooperation as fully as I have had your sympathy and help during the past week.

First of all let me state the simple fact that when you deposit money in a bank the bank does not put the money into a safe deposit vault. It invests your money in many different forms of credit-bonds, commercial paper, mortgages and many other kinds of loans. In other words, the bank puts your money to work to keep the wheels of industry and of agriculture turning around. A comparatively small part of the money you put into the bank is kept in currency -- an amount which in normal times is wholly sufficient to cover the cash needs of the average citizen. In other words the total amount of all the currency in the country is only a small fraction of the total deposits in all of the banks.

What, then, happened during the last few days of February and the first few days of March? Because of undermined confidence on the part of the public, there was a general rush by a large portion of our population to turn bank deposits into currency or gold. -- A rush so great that the soundest banks could not get enough currency to meet the demand. The reason for this was that on the spur of the moment it was, of course, impossible to sell perfectly sound assets of a bank and convert them into cash except at panic prices far below their real value.

By the afternoon of March 3 scarcely a bank in the country was open to do business. Proclamations temporarily closing them in whose or in part had been issued by the Governors in almost all the states.

It was then that I issued the proclamation providing for the nation-wide bank holiday, and this was the first step in the Government's reconstruction of our financial and economic fabric.

The second step was the legislation promptly and patriotically passed by the Congress confirming my proclamation and broadening my powers so that it became possible in view of the requirement of time to entend (sic) the holiday and lift the ban of that holiday gradually. This law also gave authority to develop a program of rehabilitation of our banking facilities. I want to tell our citizens in every part of the Nation that the national Congress -- Republicans and Democrats alike -- showed by this action a devotion to public welfare and a realization of the emergency and the necessity for speed that it is difficult to match in our history.

The third stage has been the series of regulations permitting the banks to continue their functions to take care of the distribution of food and household necessities and the payment of payrolls.

This bank holiday while resulting in many cases in great inconvenience is affording us the opportunity to supply the currency necessary to meet the situation. No sound bank is a dollar worse off than it was when it closed its doors last Monday. Neither is any bank which may turn out not to be in a position for immediate opening. The new law allows the twelve Federal Reserve banks to issue additional currency on good assets and thus the banks which reopen will be able to meet every legitimate call. The new currency is being sent out by the Bureau of Engraving and Printing in large volume to every part of the country. It is sound currency because it is backed by actual, good assets.

As a result we start tomorrow, Monday, with the opening of banks in the twelve Federal Reserve bank cities -- those banks which on first examination by the Treasury have already been found to be all right. This will be followed on Tuesday by the resumption of all their functions by banks already found to be sound in cities where there are recognized clearing houses. That means about 250 cities of the United States.

On Wednesday and succeeding days banks in smaller places all through the country will resume business, subject, of course, to the Government's physical ability to complete its survey. It is necessary that the reopening of banks be extended over a period in order to permit the banks to make applications for necessary loans, to obtain currency needed to meet their requirements and to enable the Government to make common sense checkups. Let me make it clear to you that if your bank does not open the first day you are by no means justified in believing that it will not open. A bank that opens on one of the subsequent days is in exactly the same status as the bank that opens tomorrow.

I know that many people are worrying about State banks not members of the Federal Reserve System. These banks can and will receive assistance from members banks and from the Reconstruction Finance Corporation. These state banks are following the same course as the national banks except that they get their licenses to resume business from the state authorities, and these authorities have been asked by the Secretary of the Treasury to permit their good banks to open up on the same schedule as the national banks. I am confident that the state banking departments will be as careful as the National Government in the policy relating to the opening of banks and will follow the same broad policy. It is possible that when the banks resume a very few people who have not recovered from their fear may again begin withdrawals. Let me make it clear that the banks will take care of all needs -- and it is my belief that hoarding during the past week has become an exceedingly unfashionable pastime. It needs no prophet to tell you that when the people find that they can get their money -- that they can get it when they want it for all legitimate purposes -- the phantom of fear will soon be laid. People will again be glad to have their money where it will be safely taken care of and where they can use it conveniently at any time. I can assure you that it is safer to keep your money in a reopened bank than under the mattress.

The success of our whole great national program depends, of course, upon the cooperation of the public -- on its intelligent support and use of a reliable system.

Remember that the essential accomplishment of the new legislation is that it makes it possible for banks more readily to convert their assets into cash than was the case before. More liberal provision has been made for banks to borrow on these assets at the Reserve Banks and more liberal provision has also been made for issuing currency on the security of those good assets. This currency is not fiat currency. It is issued only on adequate security -- and every good bank has an abundance of such security.

One more point before I close. There will be, of course, some banks unable to reopen without being reorganized. The new law allows the Government to assist in making these reorganizations quickly and effectively and even allows the Government to subscribe to at least a part of new capital which may be required.

I hope you can see from this elemental recital of what your government is doing that there is nothing complex, or radical in the process.

We had a bad banking situation. Some of our bankers had shown themselves either incompetent or dishonest in their handling of the people's funds. They had used the money entrusted to them in speculations and unwise loans. This was of course not true in the vast majority of our banks but it was true in enough of them to shock the people for a time into a sense of insecurity and to put them into a frame of mind where they did not differentiate, but seemed to assume that the acts of a comparative few had tainted them all. It was the Government's job to straighten out this situation and do it as quickly as possible -- and the job is being performed .

I do not promise you that every bank will be reopened or that individual losses will not be suffered, but there will be no losses that possibly could be avoided; and there would have been more and greater losses had we continued to drift. I can even promise you salvation for some at least of the sorely pressed banks. We shall be engaged not merely in reopening sound banks but in the creation of sound banks through reorganization. It has been wonderful to me to catch the note of confidence from all over the country. I can never be sufficiently grateful to the people for the loyal support they have given me in their acceptance of the judgment that has dictated our course, even though all of our processes may not have seemed clear to them.

After all there is an element in the readjustment of our financial system more important than currency, more important than gold, and that is the confidence of the people. Confidence and courage are the essentials of success in carrying out our plan. You people must have faith; you must not be stampeded by rumors or guesses. Let us unite in banishing fear. We have provided the machinery to restore our financial system; it is up to you to support and make it work.

It is your problem no less than it is mine. Together we cannot fail.

Note: Barack Obama quoted from this today during a campaign rally in La Crosse, Wisconsin.

For those of you in the College Park/North Lake Worth area, Charlie Crawford and White Apron Catering just opened a wonderful facility on North Dixie Hwy. They have an assortment of gourmet items for sale. I just stopped in for a take out lunch ... excellent food as always.

If you have a chance, stop by and welcome Charlie and his staff to the neighborhood.

Re-Post - I just came from a Commissioner Vespo Meet and Greet and this topic came up during the discussion. It concerned the similarities and differences between the Lake Worth beach and the one in Delray Beach. You'll notice that the distance from commercial building to seawall is the same in both locations - but Lake Worth is blessed with more public land.

Don't forget that older posts are available via the search function - upper left corner, through clicking on the topic tabs on the right hand side of the page and by clicking on the date further down the page.

Here are a series of comparisons with other beach areas in South Florida. The selections here include South Florida communities where the mainland downtown street leads to an ocean beach area. Besides Lake Worth, I have chosen Delray Beach and Fort Lauderdale as examples. These weren't chosen as places to emulate -hardly-, but to show how positively the current Greater Bay site plan compares with geographically similar situations.

(remember, if you would like to see greater detail, just click on the image)

I always think it's a good idea to remind ourselves that we are part of the greater South Florida Urbanized Mass (SFUM) of 5,000,000 people. The picture above shows that better than any - and it only shows a portion of the SFUM. This reminds us that we are already part of an ecologically disturbed and urbanized environment. Lake Worth has an area of about 5 miles by 5 miles and we have a population of 40,000 - a very small potion of the total SFUM. Where the City has waterfront - either Lake Worth or the Atlantic Ocean - a considerable amount is under the City's control.

The above picture is of the Lake Worth municipal beach and vicinity from about 2300 ft. A couple items are interesting to point out. One is the relatively wide area that the Lake Worth Lagoon occupies in the Lake Worth area, as compared to the examples that follow. The area hasn't been subjected to dredge and fill projects that the other communities have. You can also see the amount of public land on the water - including the beach, the area west of A-1A, Bryant Park and the municipal golf course. You can also see a portion of the Snook Island natural area. The main point here is that we should recognize that this is essentially an urban area with a definite "line of adjacent construction" north and south of the City's municipal beach property. Almost uniformly, the properties to the north and to the south have fortified seawalls of some kind - including the beach property itself. While not ideal, it is an existing condition that will not likely change in the near future - barring a catastrophic storm event. Finally, you can see the predominance of paving and parking that is part of the existing condition of our beach park.

Here we focus in on what Commissioner Jennings thought was too close to the ocean and too far east of the Coastal Construction Control Line (CCCL). There is another post that addresses the CCCL. What was not discussed by Commissioner Jennings is how this 75 feet (minimum setback - Beach and Casino zoning district) is farther away than most of the other already existing construction up and down the barrier island. And, as we will see by the other examples, it is one that is common to other coastal communities with central beach properties. It also should be noted that this is the "minimum setback" as mandated by the Beach and Casino zoning district - if you notice from the site plan in other posts, the seawall does not run directly north and south - but the new casino and other buildings do. That means that most of the individual buildings are farther away than 75 feet from the seawall - this is only the closest point.

Also note that the substantial dune vegetation east of the sidewalk area is not depicted on the illustrative site plan. This would be maintained and is an omission on the plan.

This is the passive green space and park area planned for the southeast corner of the property. As you will see by comparison to other communities, this is unusual as it relates to the built environment along the urbanized coastal area. This area is currently home to the most underutilized of the beach and it consists almost completely of paved area. The picture below was taken last Sunday. The entire stripped area is rarely used, except maybe for a police cruiser or two. THIS IS PRIME PUBLIC OCEANFRONT SPACE AND IS WASTED IN ITS CURRENT USE AND CONFIGURATION.

The area above doesn't even appear on the Greater Bay illustrative site plan. This is a leftover parking area - a major portion of which was claimed by the owner of the condominium property recently finished. That property happens to be in the Town of Palm Beach. This would probably be a good area to continue the dune vegetation that exists to south and blend into the passive park area. In its present condition, it represents a waste of publicly owned oceanfront property, a site for garbage and dirt to collect and a prime area for unwholesome activity, if you know what I mean.

So let's visit Delray Beach. Above we have the same vantage point as the overall Lake Worth beach picture - taken from about 2,300 ft. You can see that the Intracoastal Waterway is much narrower there. Areas of the barrier island have obviously been subjected to fill - I would bet that the width of the barrier island has been at least doubled from its natural state. Notice the lack of public land - save for the beach area (east of A-1A) - and the amount of area that is either building or pavement in the form of parking area or public roads.

Here we have a close up and I have scaled off the space between what would be their seawall and the edge of the closest building(s). And, lo and behold, it ends up being 70 ft - including right of way and parking area. Where is the green space? Where is the open space? Where is the 18 acres of public property? The answer to all three questions is "Lake Worth and the Greater Bay illustrative site plan".

Let's continue south to Ft. Lauderdale. Here we have a similar viewpoint from 2,300 above the surface. Here we have more examples of former dredge and fill activity, much more marina presence and hardly any green space.

The above picture brings us closer and, besides palm trees, there doesn't seem to be much in the way of green space, parking predominates the land uses and the buildings are right on the sidewalk. Most importantly, if you look at the seawall location and do the scaled measurement, we end up with a 70 ft. distance from the edge of the buildings to the seawall. Hmmm. Seems like a pattern.

My point here is that the Greater Bay plan is unusual in that it keeps green space near the ocean and that is something lacking in similar municipal settings. It is also apparent that a 70 to 75 ft. setback is a common condition from the seawall. These communities are also subject to the same CCCL that we are as administered by the Florida Department of Environmental Protection. By way of comparison, Lake Worth has preserved its public waterfront better than other communities that have faced similar development pressures.

First and foremost, I would like to thank all of you for participating in the Lake Worth Police Department’s C.O.P. Program. It was because of the dedicated individuals such as you that made it as successful as it was.

This Monday we are all being sworn in as P.B.S.O. employees. The C.O.P. cell phones will be turned off this Sunday. I will be picking up the C.O.P. cars on Monday, and as of the 1st of October do not wear your uniforms for anything, as our program will cease to exist.

As I stated in a previous email, the Palm Beach County Sheriff’s Dept. has the most successful C.O.P. program in the country, and I am sure that this program will be started up again under their authority. If they do tweak it, it will only be for the better. There will be different cars and uniforms and there will probably be retraining as well, and hopefully I will have answers to those questions shortly.

I am also happy to say that I will be staying in Lake Worth to continue with the program.

I would ask that anyone of you that would like to continue in the C.O.P. Program with the Palm Beach County Sheriff’s Dept. to please respond to my email and advise, so that I can contact you when this does happen.

Again, thanks for all that you’ve done, and my gratitude goes out to Normay and Walter, the Captains in the North & South ends, as I could not have done this without the two of you.